My partner, now husband, and I moved to Delaware from our beautiful, paid-off home in Pennsylvania, 11 years ago to escape the ever-increasing real estate/school taxes in Pennsylvania.
We didn't want to move. Hardly a day goes by that my partner/husband laments how much he misses our home in Pennsylvania, a home we planned to live out our days in. But when our taxes reached the $8,000 a year threshold, and were increasing each year 10 to 15 percent, I had no other choice than to sell our dream home and move to Delaware, the Land of Low Taxes.
I had always envied my longtime school friend Larry who lived in Claymont, and his low three figure annual tax payment. My friend Bob who lived outside Georgetown, and his low three-figure annual tax payment. Even my late millionaire friend Ed, who lived on the 300 block of Laurel Street in Rehoboth Beach; his taxes were also under $1,000 a year.
"Time to move" I told myself. So we uprooted everything and put our house up for sale and had a new house built in Milton. This was in the year 2006, right as the housing market started to collapse. We almost lost everything because we owed money on our new house and couldn't sell our old house. We eventually did sell our old house, and ended up with a $100,000 mortgage on our new house, which we hadn't planned on. This was bad, but at least we now had a low tax bill that wasn't going to increase 8 to 10 percent a year or more.
However, since we have lived here we have seen our tax bill slowly increase from $1,200 a year to now $1,500 a year. This was the net bill, less the $500 tax credit given senior citizens who had lived in their home at least a year. A welcome break from our Pennsylvania tax bill, which was rapidly approaching $10,000 a year.
Our main source of income is our Social Security payments. I also receive three small pension payments from my career years bouncing between banking jobs, trying to survive "right sizing."
Now, in order to supplement our income and keep up with the ever-increasing household bills like heat, electric, insurance and food, I work part-time at a local hotel.
My partner spouse is 88 years old. I am 75 years old. There will come a time when our household will have to get by on only one Social Security payment. And, if I'm fortunate enough to have a long life, there will probably come a time when I'm not checking in hotel guests and earning those extra few dollars that enable me to "indulge" myself and take a holiday a few times a year, and keep up with those ever-increasing household bills and insurance payments.
Over the past few years I have already started to cut back on expenses. Do I need that fancy phone plan? Perhaps not, so I cut back. Do I really need all those magazines subscriptions? Besides, those magazines are all filled with ads anyway. Cancel those subscriptions.
Do I really need to eat out at all those fine Rehoboth/Lewes restaurants? We cut out those restaurant forays last year.
Each month I see all our bills increase while our Social Security payments and my pension payments stay the same. I'll never see another increase in my pay at the hotel in my lifetime. Service jobs are notoriously underpaid. One doesn't get rich off a hotel front desk job, no matter how many Trip Advisor kudos one receives.
Then I read in the Cape Gazette that Governor Markell submitting his final budget suggests eliminating the $500 senior citizen tax credit on their real estate/school tax. Really?
One of the pleasant surprises for me, when we moved to Delaware, was how respectful Delaware was to its senior citizens by giving them a tax break like this. Unlike Pennsylvania which is cold and raises those taxes each year, regardless of age or income bracket.
Delaware recognized the value of encouraging senior citizens to relocate to Delaware and thus contribute to the local economy. In my 10 years working at the hotel I have lost count how many couples have told me they were visiting Delaware to check out the housing situation because they could no longer afford the taxes in their home state. Almost all of my neighbors in the development where I live now have retired here from another state to get away from the high taxes from their home state.
Did they move here because of the fabulous Delaware beaches?
Did they move here to be closer to the outlet stores?
Did they move here for the gourmet restaurant experience?
Did they move here because of the fishing opportunity?
Not a one.
When I asked them, they all told me they were moving because they couldn’t afford to pay the school/real estate taxes in their home state any more.
To me it is very shortsighted to take away the $500 senior citizen discount on the school/real estate tax bill for the amount of revenue anticipated of $25 million. While $25 million is no amount of small change, it is only a drop in the bucket of the $350 million shortfall in the proposed $4.13 billion Delaware state budget. To me it just doesn’t make a lot of sense to ask those thousands of senior citizens living in Delaware struggling to get by on a fixed income to pay an extra $500 a year in taxes.
Just who thought this was a good idea?
Ronald W. Tipton
Milton
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